(Updated 8:48 p.m.) Lawmakers and medical staff urged the state Monday to move along the approval process for Yale-New Haven Health’s bid to buy healthcare networks owned by Prospect Medical Holdings.
Yale-New Haven is looking to buy Waterbury HEALTH and Eastern Connecticut Health Network amid ongoing complaints that the two networks are struggling to pay bills under Prospect’s ownership.
Medical staff painted a bleak picture of the hospitals, raising concerns that one or more facilities could close if for-profit Prospect isn’t allowed to sell off the facilities.
“I’m surrounded by dedicated healthcare workers who just want to do their jobs, take care of their patients and make sure that their communities are safe and well cared for,” Waterbury Hospital pulmonologist David Hill said.
Hill said Prospect’s financial woes have led to difficulties maintaining supplies and even billing patients for services.
Yale-New Haven announced in February 2022 that it entered into an agreement to buy the two networks, which include a total of 708 beds across Waterbury Hospital and ECHN’s Manchester Memorial and Rockville General hospitals.
The two sides have since been awaiting approval from the Office of Health Strategy, which must approve a certificate of need for all hospital mergers.
Those talks include Yale-New Haven’s request for state aid to offset the $435 million price tag to buy the facilities from Prospect, which has accumulated debt and cut services.
Yale-New Haven has not disclosed the final figure, but reports indicate the healthcare network is seeking $80 million in state aid.
Gov. Ned Lamont Monday confirmed Yale-New Haven has asked for aid, but said he believes “taxpayers shouldn’t be involved” in an agreement between two private entities. Still, he remained confident a deal would get done.
“I know they’re negotiating to get a deal done,” Lamont told reporters. “A deal will get done.”
A spokeswoman for the Office of Health Strategy, meanwhile, said the agency’s role is to help the two sides reach an agreement.
The agency also said this deal is complicated by the fact that it involves three hospitals and a medical group, not just a single hospital.
“To rush any one of these reviews would not serve the interests of the public or be in compliance with OHS’s governing statutes,” the statement said. “Despite all these factors, OHS’s process for this application is still well within the statutory guidelines.”
Speakers at the press conference Monday said OHS should move the process along and approve the merger.
They warned that a hospital closure would be devastating for both the surrounding community and for other hospitals that would need to take on additional patients.
“They (Yale-New Haven) could walk away and if they walk away, there is no other buyer,” said Saqib Naseer, a cardiologist with ECHN.
Naseer expressed concern that the Office of Health Strategy will put too many conditions on Yale-New Haven, and that could lead to the healthcare network leaving.
Yale-New Haven declined to comment. A spokeswoman for OHS also did not respond to a request for comment.
A spokeswoman for Waterbury HEALTH said she was aware some staff “feel compelled to participate in this event due to its relevance to our future,” but she distanced Prospect from the event.
“While we respect the rights of our employees to engage in civic activities, patient care remains our utmost priority,” the spokeswoman, Lauresha Xhihani, said. “We are continuing to provide quality, compassionate care to our patients today, as we do every day.”
Medical workers were especially critical of for-profit Prospect Medical, which acquired the two networks in 2015.
They said Prospect put ECHN and Waterbury HEALTH in dire straits financially with a series of decisions, including selling the networks’ buildings to a real estate holding company that charges the hospitals rent.
They also said the company has failed to make important investments in areas like cybersecurity, leading to a cyber attack in August at all 16 Prospect-owned hospitals nationwide.
Staff said the cyber attack forced the hospitals to divert some patients elsewhere, overcrowding unprepared emergency rooms. They also said they had difficulty billing patients for services, creating even bigger financial problems for already cash-strapped hospitals.
“I never would have thought in my life that I would come across a situation like this,” Dushyant Gandhi, president of ECHN’s medical staff, said.
Sen. Saud Anwar, chairman of the legislature’s Public Health Committee, said the Office of Health Strategy has already taken too long.
He also said he doesn’t want Lamont to “bail out” Prospect’s shareholders by contributing state aid to cover any debt, though. He’d prefer to see Attorney General William Tong find a way to make Prospect pay for any deficiencies.
Lawmakers said Prospect’s ownership should demonstrate that the state should change how it evaluates proposals by for-profit companies looking to purchase hospitals.
“I think we need to learn from this and see that it doesn’t happen again,” Rep. Jason Doucette, D-Manchester, said, noting Prospect promised to invest in the hospitals when it sought approval in 2015.
They also said they want to look at other reforms, such as speeding up the process when someone is looking to purchase a hospital.
The Connecticut Hospital Association agreed. CHA declined to weigh in on Yale-New Haven’s proposal, but said the delay highlights a problem with the process.
“The state’s Certificate of Need regulatory review process, which is required to approve such acquisitions, has moved much too slowly in this and many other cases, creating delays that can negatively impact access,” the CHA said in a statement. “If CON is only about process and not about how decisions affect patient care, jobs, and the economy in our state, then we’ve lost our way. This situation is one of far too many that show the significant need to reform this system.”
Anwar said he believes it’s been easier for healthcare networks to get approval to reduce services or end programs than it has been for hospitals to make mergers or add programs.
“Right now it’s working the other way around — whoever wants to leave can leave, and the ones that want to come are not allowed to come in,” he said. “I think we need to set those priorities and create mechanisms and efficiencies which are not going to harm the wellbeing of our patients.”
